China Northern Rare Earth (Group) High-Tech Co.,Ltd Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

China Northern Rare Earth (Group) High-Tech Co.,Ltd (SHSE:600111) missed earnings with its latest first-quarter results, disappointing overly-optimistic forecasters. Unfortunately, China Northern Rare Earth (Group) High-TechLtd delivered a serious earnings miss. Revenues of CN¥5.8b were 18% below expectations, and statutory earnings per share of CN¥0.014 missed estimates by 91%. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for China Northern Rare Earth (Group) High-TechLtd

Following the latest results, China Northern Rare Earth (Group) High-TechLtd's seven analysts are now forecasting revenues of CN¥34.2b in 2024. This would be a decent 14% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to surge 76% to CN¥0.73. In the lead-up to this report, the analysts had been modelling revenues of CN¥32.9b and earnings per share (EPS) of CN¥0.76 in 2024. Overall it looks as though the analysts were a bit mixed on the latest results. Although there was a a decent to revenue, the consensus also made a minor downgrade to its earnings per share forecasts.

There's been no major changes to the price target of CN¥25.06, suggesting that the impact of higher forecast revenue and lower earnings won't result in a meaningful change to the business' valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on China Northern Rare Earth (Group) High-TechLtd, with the most bullish analyst valuing it at CN¥30.87 and the most bearish at CN¥19.37 per share. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await China Northern Rare Earth (Group) High-TechLtd shareholders.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. We can infer from the latest estimates that forecasts expect a continuation of China Northern Rare Earth (Group) High-TechLtd'shistorical trends, as the 19% annualised revenue growth to the end of 2024 is roughly in line with the 16% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 11% per year. So although China Northern Rare Earth (Group) High-TechLtd is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for China Northern Rare Earth (Group) High-TechLtd. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. The consensus price target held steady at CN¥25.06, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple China Northern Rare Earth (Group) High-TechLtd analysts - going out to 2026, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 1 warning sign for China Northern Rare Earth (Group) High-TechLtd you should be aware of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.